Real Estate Blog

Number of Newcomers Declines; Wage Growth Could Still Spark Housing Demand

Where is it Occurring, and How High Will it Go?

Clearly, home prices in Northern Virginia are exorbitant and continue to rise. Low inventory levels and high demand have propelled the median sales price to its new peak, and pushed the median number of days that a home is on the market to a new low.

Home price appreciation is widespread across the nation, but particularly pervasive in Northern Virginia. Within the region, there exists wide variation in home sale price by location and housing type. When will it stop?
At some point, people will hit their breaking points and refuse to pay premium rates for a home that does not fully match their needs or desires. Nevertheless, multiple factors are at play that influence the housing prices, and the extent of that rise may not be easy to determine. 

OVERVIEW
From July 1999 to July 2017, the median home sale price in the NVAR region has appreciated 146.5 percent or 8.2 percent on average annually, based on the multiple listing data. Much of this growth occurred building up to the real estate crisis beginning in mid-2007. However, in 2013, that price surpassed the July 2005 pre-recession peak of $501,556 and has been climbing higher since. The median home sale price in the NVAR region reached $535,000 in June – the highest month on record.

This is not just a local phenomenon – but a national trend as well. Nationally, the median existing-home price for all housing types in June was $263,800 according to the National Association of Realtors®. This surpasses May, at $252,800, as the highest median sales price on record, and marks the 64th straight month of year-over-year gains. In addition, the median sales price of new US homes in June was $310,800. This represents an appreciation of 103.5 percent or 5.2 percent on average annually over the past 20 years.

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